Jerome York And The IBM Turnaround
The initial obituaries that have been written so far, including this one in the New York Times, do a fine job of recounting York's exceptional - - some might say historic - - skill at guiding the finances of big businesses during exceptionally turbulent times.
Though he only served about two years as IBM's chief financial officer, it seems a shame that his tenure in Armonk, N.Y. is so far being reduced to a footnote or a passing mention by some. With Louis Gerstner and Gerstner's turnaround team from 1993 to 1995, York was a key player in helping to prevent the iconic company's collapse.
"Jerry York played a very important role during the early days of the IBM transformation," Gerstner said in a statement. "He was an extraordinary analytical executive. He demanded deep, insightful analysis of business issues before decisions were made. As such, he was a great ally in helping a CEO assess the underlying causes of a company's strategic challenges."
That gets to the heart of York's contribution.
When he started as its CFO, IBM's mainframe cost structure was, to be polite, out of balance with the personal computer, killer-app era. IT dollars were massively shifting. In his book, "Who Says Elephants Can't Dance?," Gerstner credits York with very quickly cutting $2.8 billion from IBM's cost structure. (That's $2.8 billion in mid-1990s dollars.) The cuts were painful, and included layoffs, but it gave IBM enough breathing room to keep fighting and changing the business. While there were a lot of job reductions, York's actions eventually helped save or create many times more jobs than were cut.
His work ethic was also legendary, as one might expect from a graduate of the U.S. Military Academy. It's been said that, one time during a heavy snowstorm in upstate New York, York drove his four-wheel drive to the office at IBM and was surprised when not everybody else was reporting for duty.
Stories are legendary about how demanding York could be, especially during those difficult days at IBM. But you can't spend as much time at the upper levels of the most important companies in the industry, or American business, as York did without getting the job done.
York's career wasn't perfect. He served briefly as chairman and CEO of Micro Warehouse - a job for which he seemed ill-suited at the time, and he couldn't save that company, for instance.
But his work at Apple, Chrysler and IBM made a world of difference.